A U.S. company has a subsidiary in the U.K., acquired at a cost in excess of the subsidiarys book value. The U.S. dollar has steadily strengthened with respect to the pound sterling. The subsidiarys functional currency is the pound. Which statement is true concerning the effects of consolidation eliminations (R) and (O), recognizing beginning-of-year revaluations and write-offs for the current year?

Select one:

a. Additional net losses will be reported in other comprehensive income.

b. Additional net gains will be reported in net income.

c. Additional net losses will be reported in net income.

d. Additional net gains will be reported in other comprehensive income.